Diversity Leadership in IHRM - Essay Example

Diversity Leadership in IHRM Introduction Diversity is often referred to as the differences between the individuals (Hartley, 2006). The dissimilarities among individuals materialize in both non visible and visible aspects. Some of the key examples of diversity among the individuals are dissimilarities in gender, age, skills, sexual preferences, learning styles, tenure, etc. These differences are evident the workplace but at times the differences are not visible. “Excellence through diversity is one of the Chancellor's goals”, yet this term are often faces confusion, controversy and tension. Regarding this aspect, scholars such as Griffin (2005) emphasizes managing diversity in the firm offers various advantages and the most common one emerges in the form of catering to diversified base of customers. However, contradicting this statement another set of scholars such as Inyang and Akpama (2002) and Kiggundu (1989) believes that although managing a diverse workforce provide benefits to a firm, but it requires strong management and failure to which can lead to intergroup conflicts. Hence, it is obvious that firms planning to recruit diverse employee group must a well frame management system (Mumford, 2011; Miles and Huberman, 1994; Dlabay, and Scott, 2010; Afuah, 1998). This report seeks to shed light on the foundations of diversity management, its relationship to prevailing cross-cultural leadership styles and the power of eclectic work group design. Apart from that critical discussion of the advantages and disadvantages of the application of key areas of cross-cultural human relations, business idiosyncrasies and moral values to diversity management practice, including how such personal values would influence transformation, analyzing and evaluating lessons in cross-cultural leadership practices in both west and non-western contemporary work situations. Lastly, based on the discussion, the study will draw conclusion and will provide recommendations within the context of the assigned diversity leadership in IHRM. Diversity Management: Its Relationship with Cross-cultural Leadership Styles In this rapidly changing workplace environment, maintaining a diverse workforce helps a company to remain competitive in the market place. Scholars such as Inyang (2007) emphasizes that diversity not only brings fresh perspectives to the company but also promotes innovation and equips the company with the ability to solve complex problems. Furthermore, having a diverse workforce also allows a firm to have efficient workforce, which is a necessity in this diverse business setting. Executives who are having intercultural management skills have high demand as they have the ability to constantly adapt in this shifting trend of marketplace (Mumford, 2011; Miles and Huberman, 1994; Dlabay, and Scott, 2010; Afuah, 1998). The global marketplace is itself responsible for the need of Multinational Corporation. As a result, leadership effectiveness has been one of the major topics of discussion among the mass. The biggest question that has been into limelight since the inception of the concept of globalization is: how to efficiently manage global leadership requirements in this increasingly complex global marketplace? Leadership is one of the crucial components of the business functions of an organization. However, its function and essentiality is increasing day-by-day with the increasing complexity of technology and globalization. The advancement in technology has extended the potentiality of global economy that has literally changed the way people communicates and carries out business activities. Hence, it is an important task for the cross-cultural managers to keep track of the changes taking place in the external business environment. This will aid them in the process of mitigating the risks of the environment and at the same time capitalize on the opportunities. The current scenarios of the business environment have also augmented the need of knowledge-based enterprises. Thus, it is the responsibility of the managers to ensure efficient workflow within the organization. Globalization has also increased the need of managing diversity in the workplace. Nowadays, companies function across the national boundaries and because of that they need to be aware of the business environments of the functioning country. Apart from the business environment, culture is another major factor that shapes the business environment of a country. Hence, knowledge on culture is indispensible. A diverse work force in the form of geographical diversity will greatly help companies to deal with the issue of cross-cultural differences of two countries. In the similar way, often a company has to deal with complex projects, and in such cases, a diverse workforce allows the company to explore numerous ideas that generates from the diverse workforce. The cultural differences among the workforce allow them to come with ideas from different perspectives. The development of interpersonal skills will also help in serving the purpose and a diverse workforce is one of the key requirements to the development of interpersonal skills (Nigam and Su, 2011; Wagner, 1994; Sinha, 1995; Zhou and Martoechio, 2002; Yang and Zhang, 2001; Zhang, Yang and Zhang, 2002). In this competitive landscape, the sustainable advantage of a firm greatly depends upon the abilities and skills of the managers who can maintain and oversee diversity in workplace and implement relevant strategies that best suits in this complex business environment. Thus, the discussion makes it evident that management of diversity is the key to the success of a business. In pursuance of the effectiveness of leadership, cross-cultural leaders need to develop a culturally diverse setting and build cultural quotient. One significant element that must be given prime importance in the leadership program is culture. Advantages and Disadvantages of Cross-Cultural Human Relation From the perspective of workplace, whether to have a diverse workforce is no more a question of apprehension. The world is connected like never before and with further advancement in the travel and tourism industry, people are travelling more frequently. Hence, having a diverse workforce and managing Cross-Cultural Human Relation is obviously beneficial for a firm. However, likewise, every coin has two sides, it also has certain pros and cons and the same are detailed below – Advantages of managing Cross-Cultural Human Relation It fosters innovation throughout the organization and new ideas flow. The presence of diverse workforce in a firm also encourages a customer to give complex projects to the firm. In addition, the company also generates a sense of trust among the customers and government. Managing a diverse workforce also assists a firm to increase the profitability as with diverse workforce the company also markets their product to diverse customer segment. The level of coordination with the customers also enhances greatly with the presence of employees from that particular customer group. The company gets the opportunity to function with wider talent pools and people with different skill set and expertise ultimately augments the overall capability of the company. Disadvantages of managing Cross-Cultural Human Relation The biggest threat of having diverse workforce is inter group conflicts. The point of views and perception of people is obvious to differ and the difference increases if the members belong from different cultural background. The decision making process can be delayed due to the differences in the point of views of the team members. As a result of that the management of diverse pool of employees becomes difficult for the firm (Zhou and Martoechio, 2002; Yang and Zhang, 2001; Zhang, Yang and Zhang, 2002). Studies have shown that when people lack uniformity, it often leads to unproductively or less productivity as it might influence the overall spirit of the overall team. Lastly, disunity among the team members is one of the biggest apprehensions of diversified employees group (Nigam and Su, 2011; Wagner, 1994; Sinha, 1995; Zhou and Martoechio, 2002; Yang and Zhang, 2001; Zhang, Yang and Zhang, 2002). Cross Cultural Leadership Practices in Western and Non-Western Countries A number of scholars have emphasized on the fact that behavioral pattern, work ethics, communication styles, management labor relationships differ from one country to the other. Even the leadership competencies are conceptualized in a different way from one country to the other (Sinha, 1995). For example, countries such as China, Japan and South Korea prefers to communication through non verbal codes, whereas countries such as Germany and France prefers direct communication and always attempt to communicate physically and gather as much as information as possible (Nigam and Su, 2011). This clearly shows the difference of cross-cultural differences between western and non-western countries. Therefore, the leadership styles in western and non western parts of the world are obvious to differ (Wagner, 1994). Cooperative leadership is mostly practiced in the Asian countries. The Asians believe that rather than group praising individual praising offers better results. For example, individuals will be more satisfied if the manager is praising the employees individually. Furthermore, they also believe that praising one individual group member leaving others, adversely affects the morale of other team members. Ironically, people from the West does not bother about who is being praised or not they rather appreciates whatever is awarded to the team as a whole and does not depend upon individual praising (Pillania, 2006). This shows the great cultural difference between the two regions. In accordance with the differences in the culture, the expectation of the employees from the leaders also differs largely and this expectation has the ability to influence the behaviors of the employees and the managers. Hence, it is critical that employees remain aware of the individual cultural differences without exhibiting any biasness. This facilitates leaders to accomplish their responsibilities of developing a workplace, which promotes diversity and organizational innovation. According to Fisher (2000), flexible relationship between the leaders and their followers is essential for bringing efficiency in the organization. Technological innovation, demographic changes and globalization bring large transformations to the life of human being. Therefore, close emotional attachments between the leaders and followers are important and at times, it acts a source of competitive advantage to the firm (Nigam, Su, Elaidaoui and Karuranga, 2009). The mutual trust and loyalty increases greatly. However, these facts are common to both the cultures. The difference in the leadership perspective can be best described with real life case studies. Nigam and Su (2011) highlighted about the issues that companies might face due to cross border operation. This raises the question: which culture should the firm practice while operating in the host country (Oh and Lewis, 2009). The authors in this context emphasizes that companies should make an attempt to understand the management styles of the host country and at the same time examine the most relevant cross cultural strategies that ensures optimal performance of the organization. Li (2007) in this context enumerated that multinationals are expected to design a management culture, which is effective and has the ability to provide better results. Nigam et al. (2009) further emphasized on the fact that multinationals can follow any of the strategies depending upon the situation, as there are large differences between the management cultures of two countries. As a result of that, it is impossible to generalize a particular strategy that a firm must follow while operating in the overseas location. However, similarities are observed among the countries belonging to the similar zone i.e. western and non-western countries. Inyang (2012) worked on the cultural differences and differences of management styles in western countries and non-western countries. He considered African style of leadership to accomplish this study. Fashoyin (2005) found that management system practiced in Africa is deeply rooted in the culture of the country. Inyang (2012) enlightened that “Western management concepts and writings have dominated the thinking of academics and managers in Africa for a long-time. Such writings have not shown how culture might be taken into account in managerial practice” (p. 122). This further clarifies the large differences of the management styles. Therefore, considering the findings from the above discussion, it can be stated that cross-cultural leadership practices in both west and non-western countries due to the cultural differences as well as different expectation of the employees from their leaders. Thus, for a manager who needs to work in other countries that are culturally different from that of the host country needs to remain highly aware of the cross-cultural differences and issues and this holds true for managers from both western and non western countries. The following are the recommendations that will help managers of multinational corporations to function effectively. 1. Developing Self-Awareness: - Global leaders need to carry out a self assessment so as to identify their existing strengths and weaknesses. This is because individuals must understand and foresee their possible reaction to various situation and the parameters considered by them in the decision making process. This will help them to operate efficiently in different setting and will be successful in managing diverse workforce. 2. Understand Cultural Stereotypes: - Global leaders are strongly recommended to learn and understand the local culture of the country of operation. Furthermore, they are also strongly recommended to cultural stereotyping which will eventually assist them surmounting the personal biases and at the same time value employees. 3. Evaluation of the Impact of Diversity – A leader must have the ability to evaluate the impact of diversity on the business. The identification of the possible cons will greatly help the company to minimize numerous risks and capitalize on the opportunities. 4. Better Communication: - As mentioned previously, having a diverse workforce often creates intergroup conflicts as well as negatively affects the overall productivity of the firm due to non-uniformity. Hence, a manager needs to a better communicator so as to minimize the risks associated with diversity. 5. Looking at a broader scenario and developing a global mindset: - The manager should look from a broader perspective and should not devise strategies based on a particular market place. Apart from that developing, a global mindset will also help a manager to get accustomed with the shifting market dynamics (Nigam and Su, 2011; Wagner, 1994; Sinha, 1995; Zhou and Martoechio, 2002; Yang and Zhang, 2001; Zhang, Yang and Zhang, 2002). Findings & Discussion The last decade of the twentieth century has transformed globalization into an irreversible trend. The beginning of the twenty-first century has further experienced globalization as one of the commonplace among the academicians. For example, Wang, et al. (2005) stated that in the context of China, the process of globalization initiated with their adoption of western practices. Furthermore, the entry of China in world trade organization is expected to deep effects on the global market place and lead towards further development. However, in reality studies have shown that numerous companies of China have actually failed to transplant and get accustomed with the western practices in the Chinese context. Goodall and Warner (1999) emphasized on the fact that the HR managers of Chinese company still follows the traditional approach and that is hindering the adoption process. Furthermore, the differences in culture are also acting as a major hindrance (Nigam and Su, 2011; Wagner, 1994; Sinha, 1995; Zhou and Martoechio, 2002; Yang and Zhang, 2001; Zhang, Yang and Zhang, 2002). Hence, it is obvious that the difference in culture is playing indispensible role in shaping the operation of the firm. The application of diversity leadership has been effective in this context as Chinese firms have been able to get better grip over the situation. Thus, it can be concluded that diversity leadership is one of the crucial tools for mitigating and managing the risks associated with operating in a country with different culture and preference. Conclusion This study meant for analyzing the importance of diversity leadership in this increasingly competitive market place. Apart from that the significance of diversity leadership in cross-cultural leadership practices were also analyzed. The study revealed that in this turbulent business situation, cross border business is one of the activities that allow business houses to embrace growth and development. As a result of that operational issues are bound to appear a there are large differences between domestic and international market and one of the major forces that is responsible for such differences is the cultural difference of two nations. The study also revealed that companies face various kinds of issues while carrying out overseas operation. Hence, in order to surmount these challenges companies are now implementing various strategies that will allow the firm to remain aware of the cultural differences and at the same time satisfy customers. Diversity leadership is one such tool that is effectively used by firms nowadays. Apart from that, most of the firms are managing a diverse workforce that facilitates them to remain innovative and solve complex issues. References Afuah, A. (1998). Innovation management: strategies, implementation and profits. Oxford: Oxford University Press Dlabay, L. R. & Scott, J. C. (2010). International Business. 4th ed. Connecticut: Cengage Learning Fashoyin, T. 2005. Management in Africa. Lagos Organization Review, 11, pp. 43-45. Fisher, C. D., 2000. Mood and emotions while working: Missing pieces of job satisfaction? Journal of Organizational Behavior, 21, 185-202. Griffin, R. 2005. Management. 8th ed. Boston: Houghton-Mufflin. Hartley, N.T. 2006. Management history: an umbrella model. Journal of Management History, 12 3, pp. 278-292. Inyang, B. J. 2007. Management theory: principles and practice. 2nd ed. Calabar, Nigeria: Merb Publishers. Inyang, B. J. and Akpama, A. M. 2002. Personnel management practice in Nigeria. Calabar, Nigeria: Merb Business Centre. Inyang, B. J., 2008. The Challenges of Evolving and Developing Management Indigenous Theories and Practices in Africa. International Journal of Business and Management, 3 (2), pp. 122-132. Kiggundu, M. N. 1989. Managing organizations in developing countries. West Harford, CT: Kumarian Press. Miles, M. B. & Huberman, A. M. (1994). Qualitative Data Analysis: An Expanded Sourcebook. London: SAGE. Mumford, M. (2011). Handbook of Organizational Creativity. Waltham: Academic Press Nigam, R., and Su, Z., 2011. Management in Emerging versus Developed Countries: A Comparative Study from an Indian Perspective. Journal of CENTRUM Cathedra, 4(1), pp. 121-133. Nigam, R., Su, Z., Elaidaoui, N., and Karuranga, E., 2009. Subsidiaries of developed country multinationals in an emerging country: A cultural perspective. Global Journal of Flexible Systems Management, 10(4), pp. 33-44. Oh, S., and Lewis, G. 2009. Can performance appraisal systems inspire intrinsically motivated employees? Review of Public Personnel Administration, 29(2), pp. 158-167. Pillania, R. K. 2006. State of organisational culture for knowledge management in Indian industry. Global Business Review, 7(1), pp. 119-135. Sinha, J. B. P. 1995. The cultural context of leadership and power. New Delhi, India: Sage. Wagner, J. A., 1994. Participation’s effect on performance and satisfaction: A reconsideration of research evidence. Academy of Management Review, 19, 312–331. Wang, J. et al., 2005. Confucian Values and the Implications for International HRD. Human Resource Development International, 8(3), pp. 311-326. Yang, B. and Zhang, D. (2001) How to develop human resources: technical rationality or social moral responsibility? A comparison of Western and Chinese human resource theory and practice. Proceedings of the Academy of Human Resource Development International Research Conferences, pp. 277 — 84. Zhang, D., Yang, B. Y. and Zhang, Y. C. (2002) Challenges and strategies of developing human resources in the surge of globalization: a case ofthe People's Republic of China. Honolulu: HI Publishers. Zhou, J. and Martoechio, J. J. (2002) Chinese and American managers' compensation award decisions: a comparative policy-capturing study. Personnel Psychology, 54(1), pp. 115-45. Read More